Data shows a large amount of liquidations have piled up on cryptocurrency exchanges during the past day as Bitcoin and the altcoins have crashed.
Bitcoin & Other Assets Have Witnessed Bearish Action In Last 24 Hours
The past day has been a volatile time for the cryptocurrency sector as the U.S. Federal Reserve has revealed a cautious outlook on interest rate cuts during the latest Federal Open Market Committee (FOMC) meeting.
Reacting to the news, the Bitcoin investor selloff took the price to as low as under $99,000, but the crash was only short-lived, with the digital asset's price showing some quick recovery.
The trend in the price of the coin over the last five days | Source: BTCUSDT on TradingView
As is visible in the above graph, Bitcoin has already returned above $102,400, meaning the coin is down less than 3% during the last 24 hours. The altcoins, however, haven't been so lucky, as most of them are still down notable amounts. Ethereum, the second largest asset in the sector, has seen losses of 5% in this window.
With the market-wide price crash, it's not a surprise that the derivatives side has gone through chaos of its own.
Crypto Longs Have Just Taken A Massive Beating
According to data from CoinGlassthere has been a mass amount of liquidations in the cryptocurrency derivatives market during the past day. “Liquidation” here refers to the forceful closure that any open contract undergoes after it amasses losses of a certain percentage.
Below is a table that shows the numbers relevant to the latest market flush:
Looks like the liquidations have heavily tended towards long contracts | Source: CoinGlass
As is visible above, there have been almost $790 million in cryptocurrency-related liquidations over the last 24 hours. Out of these, $662 million of the contracts involved were long ones, representing 84% of the total. This is naturally down to the fact that the market as a whole has crashed.
In terms of the contributions from the individual symbols, Bitcoin and Ethereum have predictably come out on top once more.
The breakdown of the liquidations by symbol | Source: CoinGlass
Out of the rest, XRP, Dogecoin, and Solana have stood out, as they have each contributed to $40 million, $29 million, and $23 million in liquidations, respectively.
A mass liquidation event, popularly called a squeeze, isn't something too uncommon for the cryptocurrency sector, due to the fact that assets tend to be volatile and leveraged trading is popular. That said, the scale of the latest flush is still notable and underlines the high speculative interest present in the market amid the bull run.
The squeeze hasn't discouraged these traders, either, as the Bitcoin Open Interest continue to sit at an all-time high (ATH).
The BTC Open Interest appears to have been climbing alongside the recent price rally | Source: CoinGlass
Featured image from Dall-E, CoinGlass.com, chart from TradingView.com
